Bitcoin is not so viable for Venezuela's reserves, say economists

Economists Asdrúbal Oliveros, Aaron Olmos and Francisco Rodríguez give their impressions on the bitcoin plan presented by María Corina Machado.

A series of institutional changes will be necessary to implement the plan.

The volatility of bitcoin could represent one of the main problems. María Corina Machado's proposal to integrate bitcoin (BTC) as a national strategic reserve asset in Venezuela has been one of the most relevant news within the ecosystem.

This is so, not only because it is the first time that the opposition leader talks about the digital currency, but also because it is a proposal as bold as it is risky, in the midst of the economic and political crisis in which the country is immersed. The idea of ​​including BTC in international reserves is part of a macro trend, which has been gaining strength in recent years. The same has President Nayib Bukele in El Salvador as a pioneer, through the purchases that the government has been making since 2021.

The strategy gains greater notoriety after the Republican senator Cinthya Lummis presented a bill in the United States last July to add BTC to the reserves. The project, which proposes the purchase of 5% of the total issue of BTC as a mechanism to take advantage of its long-term revaluation, was supported and included in the campaign promises currently made by former president and presidential candidate Donald Trump.

In this case, the question that must be asked is whether this strategy is viable in Venezuela and how much it can help rescue the battered economy of the South American country, affected by inflation and a series of macroeconomic imbalances.

It is a strategy that – if successful – could radically transform the country's economic trajectory and offer an innovative model to other nations in difficulty.

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